Shopping around for insurance at the time of renewal could save you hundreds

If you’re assuming that your insurance provider will reward you for your loyalty, you should probably think twice. It turns out that shopping around for insurance when it’s time to renew your policy, could actually save you hundreds of dollars every year.

According to a survey commissioned by Consumer Action, Australians want their insurance companies to be upfront with yearly price rises.

Typically, when you sign up for general insurance, you would buy 12 months of cover at a time. When this policy is about to expire, your insurance provider will send you a letter asking you to renew your insurance for another year. They will also quote a price for this renewal. However, most often, what is not clear in this communication is by how much the price for your policy has increased from the previous term and for what reasons.

Most of us are too lazy to go back and compare the price difference and end up renewing our insurance without giving it much thought or just hope that our insurer will reward us for our loyalty. Unfortunately, that is not always the case, and it is important to check on the price proposed by your insurer.

Often, a simple act of questioning your insurance company about the price they quote at the time of renewing your policy could save you a lot of money. It’s also a good idea to compare the market at the time of renewal because a new provider could easily offer you a better deal with more benefits.

If insurers care about loyalty, they should state the price you paid last year and the reason for any change in price clearly on their renewal letter, says Consumer Action. According to their survey, 86% Australians who have insurance agreed that it will be useful (or very useful) to have this information on renewal letters.